Dyer v. Bradshaw

282 S.E.2d 548 (1981)

Thomas Garland DYER v. Thomas W. BRADSHAW, Jr., Secretary of the N. C. Department of Transportation, in his Official and Individual Capacity, And his Agents, Assigns, and Successors in Interest.

No. 8110SC140.

Court of Appeals of North Carolina.

October 6, 1981.

*549 Atty. Gen. Rufus L. Edmisten by Associate Atty. Gen. James W. Lea III, and Asst. Atty. Gen. J. Chris Prather, Raleigh, for respondent-appellee.

Western North Carolina Legal Services, Inc. by Patrick Lordeon and Raymond D. Large, Sylva, for plaintiff-appellant.

VAUGHN, Judge.

The sole issue presented is whether the Superior Court had jurisdiction under any statute to review defendant's action in upholding plaintiff's dismissal. We hold the Superior Court was without jurisdiction and therefore properly dismissed plaintiff's complaint.

Plaintiff seeks judicial review of defendant's decision under G.S. 150A-43 of the Administrative Procedure Act. The statute provides:

Any person who is aggrieved by a final agency decision in a contested case, and who has exhausted all administrative remedies made available to him by statute or agency rule, is entitled to judicial review of such decision under this Article, *550 unless adequate procedure for judicial review is provided by some other statute, in which case the review shall be under such other statute....

G.S. 150A-43 (1973). There are five requirements under this statute: (1) plaintiff must be an aggrieved person; (2) there must be a final agency decision; (3) the decision must result from a contested case; (4) plaintiff must have exhausted administrative remedies; (5) there must be no other adequate procedure for judicial review.

In the case at bar, plaintiff fails to meet the third element of a "contested case." "Contested case" is defined by G.S. 150A-2(2) as "any agency proceeding, by whatever name called, wherein the legal rights, duties, or privileges of a party are required by law to be determined by an agency after an opportunity for an adjudicatory hearing." (Emphasis added). It is clear that no statute requires the Secretary of Transportation to provide an adjudicatory hearing in reviewing the recommendation of the Employee Relations Committee.

Chapter 4 of Title 19A, North Carolina Administrative Code, sets forth the mechanics for dismissal of an employee of the Department of Transportation. The unit head must thoroughly investigate the case before taking any action. If the unit head discharges an employee and the employee feels his dismissal was unjustified, the aggrieved person may then appeal to an Employee Relations Committee. The Employee Relations Committee is a five-member panel appointed by the Department of Transportation's Director of Personnel. The decision handed down by this Committee is then reviewed by the Secretary of the Department of Transportation. According to 4B.0303, "the Secretary may either agree or disagree with the recommendations made by the committee." At no point does Chapter 4 require the Secretary to provide "an opportunity for an adjudicatory hearing" before making his determination. See also Advertising Co. v. Bradshaw, Sec. of Transportation, 48 N.C.App. 10, 268 S.E.2d 816 (1980).

Plaintiff, however, contends that the hearing before the Employee Relations Committee was itself an adjudicatory hearing, and thus there was a "contested case" triggering the application of G.S. Chapter 150A. We disagree. According to the Department of Transportation's personnel manual, the Employee Relations Committee hears appeals from state employees who have been suspended, demoted, or discharged. No final determination is made by the Employee Relations Committee. Its inquiry results in a recommendation with which the Secretary is free to agree or disagree in reaching his final decision. Title 19A, North Carolina Administrative Code 4B.0303. Such a recommendation is binding only if the Secretary fails to render a decision within thirty working days of receiving its recommendation, an event which did not occur in the present case.

Plaintiff must show "an opportunity for an adjudicatory hearing" in order for there to be "a contested case" as required for judicial review under G.S. 150A-43. Because plaintiff has failed to do so, we hold that the trial court properly dismissed plaintiff's claim for relief under the Administrative Procedure Act.

Plaintiff nevertheless contends that his complaint states a claim for relief under 42 U.S.C. § 1983. Plaintiff argues that his loss of employment constituted deprivation of a constitutionally protected property and liberty interest, thereby entitling him to procedural due process. We find no constitutional violation.

Not every property interest requires procedural due process. A protected property interest arises when one has a legitimate claim of entitlement as decided by reference to state law. Bishop v. Wood, 426 U.S. 341, 96 S. Ct. 2074, 48 L. Ed. 2d 684 (1976). Thus, unless plaintiff can demonstrate that he had a legitimate claim to continued employment under either his employment contract or a state statute, he is not entitled to procedural due process in the form of an adjudicatory hearing. On this record, it is clear that plaintiff cannot so demonstrate.

*551 First, employment by the State of North Carolina does not automatically confer tenure. Nantz v. Employment Security Comm., 290 N.C. 473, 226 S.E.2d 340 (1976). There is nothing in the record which suggests that plaintiff's contract contained a duration clause. It is well established in this State that, absent such a clause, a contract of employment is terminable at the will of either party, irrespective of the quality of performance. Still v. Lance, 279 N.C. 254, 182 S.E.2d 403 (1971). Plaintiff's employment contract did not, therefore, provide him with a legitimate expectation of continued employment.

Second, there is no statutory recognition of a property interest in continued employment. G.S. 126-35 of the State Personnel Act states that no permanent employee shall be discharged except for just cause. It has been held that G.S. 126-35 "creates a reasonable expectation of continued employment and a property interest within the meaning of the due process clause." Faulkner v. North Carolina Dept. of Corrections, 428 F. Supp. 100, 103 (W.D.N.C.1977). That statute, however, only applies to employees who have been "continuously employed by the State of North Carolina for five years at the time of the act, grievance, or employment practice complained of." G.S. 126-39. The present case is governed by G.S. 126-4 which provides that the policies and rules of the State Personnel Commission

"...shall not limit the power of any elected or appointed department head, in his discretion and upon his determination that it is in the best interest of the Department, to transfer, demote, or separate a State employee who has not been continuously employed by the State of North Carolina for the immediate five preceding years."

G.S. 126-4 (1977).

In the case at bar, plaintiff had been employed by the State of North Carolina for less than five years at the time of his dismissal. He has, therefore, been deprived of neither "liberty" nor "property" within the scope of the Fourteenth Amendment. Board of Regents v. Roth, 408 U.S. 564, 92 S. Ct. 2701, 33 L. Ed. 2d 548 (1972).

The order dismissing the action is affirmed.

Affirmed.

ARNOLD and WEBB, JJ., concur.